[Ip-health] Cancer treatment: Is American patent law hindering the discovery of more cancer vaccines? - Slate Magazine

Claire Cassedy claire.cassedy at keionline.org
Mon Aug 26 10:02:00 PDT 2013


Why Aren’t There More Cancer Vaccines?

Blame America’s lousy patent system.

By Ray Fisman|Posted Monday, Aug. 26, 2013, at 5:45 AM

Six years from now, when my daughter turns 11, she will get a three-part
human papillomavirus vaccine that will reduce her chances of getting
cervical cancer by around 70 percent. Currently a little over half of
American girls get the HPV vaccine, a public health intervention that will
prevent tens of thousands of cancers. It’s one of modern medicine’s few
success stories in finding a means of preventing cancer.

Maybe the reason we have so few cancer vaccines is that they’re harder to
develop than treatments for patients who already have cancer, which are
more common. But in an as yetunpublished study, economists Eric Budish and
Heidi Williams teamed up with patent lawyerBen Roin to argue that the
scarcity of preventive measures and relative abundance of late stage cancer
treatments can also be blamed on thedistorting effects that the U.S. patent
system has on medical research.

The duration of patent protection in the U.S. is 20 years. All drug
innovations get patented at the time of discovery, but late-stage cancer
treatments will work their way through the clinical trials required for FDA
approval much more quickly, since the effect on patient survival will be
apparent within a couple of years. That means fewer years of the patent
clock ticking without revenues coming in. For a preventive treatment like
the HPV vaccine, the 20 years of patent protection will be long expired
before any clinical trial can show whether lives are being saved, which in
turn makes vaccines far less alluring investments for biotech companies.
It’s yet another indication of America’s patent system’s desperate need for
a makeover.

To appreciate what’s wrong with the American system of granting
fixed-length, 20-year patents, you first need to understand why we grant
patents—and make them expire—in the first place. A patent gives an inventor
ownership over her intellectual property, in much the same way a homeowner
holds title to her house. This affords the inventor a period of exclusive
rights to profit financially from the fruits of her innovation. Without
this protection, who would go through the time and trouble of inventing
anything in the first place, when someone could just take the idea and run
with it?

At the same time, this license to exploit an idea for private gain needs to
be balanced against the social benefits that come with universal access to
new knowledge. After a patent expires, other innovators can build on
earlier breakthroughs and competitors can market similar products without
worrying about licensing contracts, patent litigation, or other headaches.
The need to encourage invention and to let ideas be free leads to the
compromise of giving patent protection for a limited period of time. Thanks
to patent protection, we have biotech companies that spend billions
developing next-generation drugs, and thanks to patents’ limited lifespans,
we have generic manufacturers waiting to rush in with lower prices as soon
as the patent ends.


The authors’ argument for how fixed patent terms distort R&D is simple. In
most cases, inventors need to file for patents early on in the process,
before they even enter trials, lest word get out and competitors beat them
to the patent office. Consider a drug that takes two years to bring to
market. Given our 20-year patent term, the drug’s manufacturer would get 18
years of patent protection after the drug goes on sale. Now consider a drug
that takes 18 years to bring to market. Its manufacturer would get only two
years of protection once it hits the market. For drugs that take more than
20 years to develop, there won’t be any post R&D patent protection at all.

The heart of the new study shows how these incentives have affected
biomedical research in America over the past few decades, with a focus on
cancer. Why cancer? Obviously, given the suffering caused by the disease,
we care a lot about anything that might be holding back the development of
better treatments. And if you’re interested in the connection between time
to commercialization and biotech investments, cancer affords an additional
set of advantages. The lag between invention and going to market is
dictated primarily by the length of trials required for Food and Drug
Administration approval, and trial length, in turn, is determined by
patients’ survival rates. Generally, to get approval for a new cancer drug
you need to show that patients live longer. It doesn’t take long to
determine whether a new treatment adds months of life in the case of
metastatic cancers (those that have spread throughout the body): 90 percent
of patients with such cancers are dead in less than five years. But it can
take more than a decade to see whether survival is affected for localized
cancers that remain confined to a single organ. And for treatments aimed at
cancer prevention—the holy grail of cancer research—it could take multiple
decades to prove a treatment’s efficacy.

Using records from the National Cancer Institute, the authors link data on
survival rates by cancer type (e.g., prostate) and stage (i.e., local
versus regional versus metastasized) to clinical trial data on treatments
targeted at a particular stage-type (e.g., metastatic prostate). They find
that there are many more trials for deadlier cancers, a pattern that
persists after they account for other considerations such as the frequency
with which a cancer occurs or the type of individual (gender and age) most
likely affected by it. Their calculations indicate that a 10 percentage
point increase in the five-year survival rate of a given cancer type leads
to an 8.7 percent decrease in R&D investment, an enormous effect when you
consider the fact that metastatic cancers have an average five-year
survival rate of 10 percent, versus 70 percent for localized cancers.

It’s not exactly wrong to devote resources to improving the prospects of
metastatic cancer patients—theirs is the deadliest type. But as the saying
goes, an ounce of prevention is worth a pound of cure: We’d be saving more
years of life if we had more research on early-stage treatment and vaccines
that prevented people from facing metastatic cancers to begin with. The
authors provide some rough (and highly speculative) calculations for how
many lives might have been saved with a better-designed patent system, and
come up with a figure of 890,000 life-years saved for patients diagnosed in
2003 alone.

There are exceptions to the rule that late-stage cancers attract more
research resources, but many of these exceptions only serve to reinforce
the study’s findings. For example, there are a lot of clinical trials for
treatment of breast cancers of every stage. Call it the Betty Ford–Susan
Komen effect—the breast cancer awareness movement has been enormously
effective at raising money for research. But within breast cancer types,
the general pattern of more trials for metastatic than localized cancers
still holds.

Given the study’s findings, you wouldn’t expect any cancer prevention drugs
to have been developed. In fact, there are six such FDA-approved
treatments. But these were either developed with public money, meaning
profits weren’t a consideration, or gained FDA approval using so-called
“surrogate endpoint” trials, where a treatment’s effectiveness is
determined by a biological marker other than death. That turns out to have
been the case for the HPV vaccine. Gardasil, developed by Merck, was
approved on the basis of the presence of “atypical cervical cells” rather
than patient survival, so the trial lasted only around four years. In fact,
for leukemia and other cancers of the blood, where a treatment’s efficacy
can be shown based on the surrogate endpoint of white blood cell counts,
the negative relationship between cancer survival rate and number of trials
disappears, as one might expect given that survival time doesn’t affect
trial length.

Removing this distortion to research incentives would seem to be
straightforward: Allow biotech companies to apply for patents at the time
of invention, but only start the patent clock ticking after clinical trials
are completed. But even if the authors’ theory is well-reasoned,
legislative practice is quite another matter. Kevin Sharer, CEO of biotech
giant Amgen from 2000 to 2012, sums up the prospects of any major patent
reform as a “150 foot putt”—in other words, impossible. Many competing
factions would surely see any attempt to change patent law as an
opportunity to twist the rules in their favor, making intellectual property
reform another casualty of Capitol Hill gridlock.

There has been some progress in changing the way the patent system
adversely affects research. The FDA can, for example, grant a drug “market
exclusivity,” which allows the original inventor the exclusive right to
market a drug in the United States for a period of time following
regulatory approval. Legislation was passed in 2010 that should strengthen
the power of those arrangements: Some classes of drugs are now given 12
years of market exclusivity, which puts short- and long-trial drugs on a
more equal footing. (This is in addition to a patent extension of 50
percent of the time a treatment spends in trial, for up to an additional
five years, as a result of the 1984 Hatch–Waxman Act, which evidently
didn’t have much of an impact on cancer research at least.) But only about
a third of new inventions are covered by the new market exclusivity rules.
For the bulk of new discoveries—so-called small molecule drugs—the patent
system remains the same as it’s been since the early ’80s. (And very short
trial drugs will still end up with longer market protections. For example,
a three-year trial drug like Abiraterone, a prostate cancer treatment,
could still get 17 years of exclusivity.)

The authors of the new study argue that the law should go even further and
actually give long-trial drugs more protection than short-trial drugs
following approval, instead of less (and also potentially cut back
protection for short-trial drugs). Their argument has two parts: First,
drugs with short trial times also tend to have lower development costs, so
they’d get done even without the extra protection. Second, since drugs with
long trial times tend to focus on prevention or early-stage treatment, they
may have higher societal payoffs than drugs that spend just a few years in

Yet such legal innovation would surely have unanticipated consequences: For
every well-meaning rule change, creative legal teams would develop new and
unexpected ways of gaming the system. It’s for this reason that ex-Amgen
CEO Sharer says that the rule-makers had better “shine a laser beam” on the
particular disease classes where they hope to encourage innovations. Sharer
points to the Orphan Drug Act of 1983, which gave seven years of market
exclusivity, along with tax incentives, for drugs that treat rare diseases
that would go uninvestigated without greater incentives.

It’s likely that many industries besides biotech suffer from the same
distortionary effects of the 20-year patent rule—biotech is hardly unique
in the long lag between discovery and commercialization. And other areas of
research may not have the workaround of extending protection through
regulators like the FDA. So if you consider the implications of this new
study more broadly, it’s yet another argument that American legislators
need to find the political will for a long-overdue overhaul of the patent
system, and a responsibility to do it in such a way that logic and reason
do defeat the lobbying assault that would accompany it. American business
isn’t exactly renowned for forward thinking, with executives rarely looking
beyond the next quarter’s earnings. The last thing they need is an
ill-designed patent system to further encourage their short-sightedness.

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